Lets talk about the life changing subject of color cycling.
Color cycling was used in many ways during the 16 bit era, Valis (pcengine) for example used it in the first level for the sky, later levels for the effect of flowing lava. For the bone dragon boss fight in legend of xanadu I, it was used to very good effect in the background sky, snes rpg's used this effect a lot, such as in the last boss fight in Chrono trigger.
The benefit of color cycling is that your only changing colors and not actually moving pixels around, this of course means that you dont have to use as much memory or processing power, the drawback is that it doesn't look as textured/tactile as say line scrolling.
Maybe there are some examples that you can share or add to or correct what i have said.